Divestments of bank-owned equity portfolios in relationship-based financial system: The case of Germany.

摘要

My dissertation comprises three theoretical chapters focused on the divestment of ownership stakes in affiliated firms in the context of a relationship-based financial system. The models are applied to the divestments which occurred in Germany after the Tax Reduction Act of 2000. Chapter 1 explores the pricing and timing of equity divestments when an initial divestment conveys information that increases the price received for subsequent divestment of correlated asset. I examine how the expansion of post-divestment inter-group financial transactions may relieve liquidity constraints faced by individual affiliates and compare the stability of financial systems organized around conglomerate groups with that of a financial system centered on vertically integrated groups. Chapter 2 suggests that in certain cases the presence of foreign investors can be very valuable for the efficient transfers of ownership in the divestment process. This important role of foreign investment may depend on direct and ultimate ownership as well as the structure of divestment market institutions. Chapter 3 addresses the question of why many assets are being divested piecemeal. I argue that staged divestments may lead to higher proceeds than a single divestment transaction of the entire asset. This may be the case in a world of relationship value whether information is complete and free-riding is constrained or whether information is incomplete and distributed asymmetrically. I compare the two settings and discuss the important role of relationship value.